12TH COMMERCE –BOOK-KEEPING & ACCOUNTANCY

SMJ Batch: 2021-22 / Practice Test: 19 PRACTICE TEST PAPERS Marks: 30

Topic: Admission of a Partner Time: 1 Hour 30 Minutes

ANSWERS
Q.1. Journal Entries in the books of the firm
Date Particulars L.F. Debit (`) Credit (`)
2012 Reserve Fund A/c … Dr. 10,000
Apr. 1 To Paresh's Capital A/c 6,000
To Naresh's Capital A/c 4,000
(Being reserve fund distributed to old partners in profit sharing
ratio)
Apr. 1 Cash / Bank A/c … Dr. 36,000
To Dinesh's Capital A/c 36,000
(Being capital brought by Dinesh)
Apr. 1 Cash / Bank A/c … Dr. 22,500
To Goodwill A/c 22,500
(Being goodwill brought by Dinesh)
Apr. 1 Goodwill A/c … Dr. 22,500
To Paresh's Capital A/c 13,500
To Naresh's Capital A/c 9,000
(Being goodwill retained and credited to old partners in sacrifice
ratio)
Apr. 1 Revaluation A/c … Dr. 2,500
To R.D.D. A/c 500
To Stock A/c 2,000
(Being decrease in the value of stock and R.D.D. Created)
Apr. 1 Building A/c, … Dr. 2,200
To Revaluation A/c 2,200
(Being appreciated bulding by 5%)
Apr. 1 Paresh's capital A/c … Dr. 180
Naresh's Capital A/c … Dr. 120
To Revaluation A/c 300
(Being loss on revaluation distributed to old partners in old Profit
sharing ratio)
Total 96,000 96,000
 Balance sheet as on 1st April, 2012
Liabilities Amt. (`) Amt. (`) Assets Amt. (`) Amt. (`)
Sundry Creditors 30,000 Cash 59,000
Capitals A/c's Sundry Debtors 45,000
Paresh 91,320 Less: R.D.D. 1,000 44,000
Naresh 60,880 Stock 17,000
Dinesh 36,000 1,88,200 (-) Reduction 2,000 15,000
Investments 24,000
Plant 30,000
Building 44,000
_______ (+) Appreciation 2,200 46,200
2,18,200 2,18,200
Working Note:
1. Calculation of Goodwill -
32,000 + 54,000 + 49,000
Average Profit = = ` 45,000
3
1
Goodwill = Average Profit  2 years purchase
2
5
Goodwill = 45,000  = ` 1,12,500
2
1
Dinesh' s share in Goodwill = 1, 12,500  = 22,500
5
2. Balance of Cash -
Dr. Cash A/c Cr.
Particulars Amt. (`) Particulars Amt. (`)
To Balance b/d 500 By Balance c/d 59,000
To Dinesh Capital A/c 36,000
To Goodwill 22,500 ______
59,000 59,000

3. Loss on Revaluation:
Dr. Revaluation A/c Cr.
Particulars Amt. (`) Particulars Amt. (`)
To R.D.D. A/c 500 By Balance A/c 2,200
To Stock A/c 2,000 By Paresh’s Cap. A/c (Loss) 180
_____ By Naresh’s Cap. A/c (Loss) 120
2,500 2,500
Q.2. Dr. Revaluation Account Cr.
Particulars Amt (`) Particulars Amt (`)
To Stock A/c 6,000 By Building A/c 12,000
To Amit's Capital A/c 4,800 By R.D.D. A/c 1,200
To Sumit's Capital A/c
(Profit transferred) 2,400 ______
13,200 13,200

Dr. Partners’ Capital Accounts Cr.

Amit Sumit Rohit Amit Sumit Rohit
Particulars Particulars
(`) (`) (`) (`) (`) (`)
To Balance c/d 1,28,800 80,400 48,000 By Balance b/d 96,000 64,000 -
By General Reserve A/c 12,000 6,000 -
By Cash A/c - - 48,000
By Goodwill A/c 12,000 6,000 -
By Profit & Loss A/c 4,000 2,000 -
_______ ______ ______ By Revaluation A/c (Profit) 4,800 2,400 -
1,28,800 80,400 48,000 1,28,800 80,400 48,000

New Balance Sheet as on 1st April, 2011

Liabilities Amt. (`) Amt. (`) Assets Amt. (`) Amt. (`)
Capital A/c's Goodwill 18,000
Amit 1,28,800 Building 1,00,000
Sumit 80,400 Add: Appreciation 12,000 1,12,000
Rohit 48,000 2,57,200 Furniture 20,000
Sundry Creditors 80,000 Office Equipment 10,000
Sunday Debtors 63,000
Less: R.D.D. 1,800 61,200
Stock 84,000
Less: Reduction 6,000 78,000
_______ Cash 38,000
3,37,200 3,37,200
Working Note: Balance on cash account
Dr. Cash A/c Cr.
Particulars Amt. (`) Particulars Amt. (`)
To Balance b/d 16,000 By Amit's Loan A/c 26,000
To Rohit's Capital A/c 48,000 By Balance c/d 38,000
64,000 64,000
Q.3. Dr. Profit and Loss Adjustment A/c Cr.
Particulars Amt (`) Particulars Amt (`)
To Building A/c 4,400 By Akash's Capital A/c (3/5) 4,440
To Stock A/c 2,000 By Badal's Capital A/c (2/5) 2,960
(Loss transferred)
To R.D.D. A/c 1,000 _____
7,400 7,400

Dr. Partners’ Capital Accounts Cr.

Akash Badal Sagar Akash Badal Sagar
Particulars Particulars
(`) (`) (`) (`) (`) (`)
To Plant A/c 30,000 - - By Balance b/d 1,44,000 96,000 -
To Goodwill A/c (written off) 60,000 36,000 24,000 By General Res. A/c 12,000 8,000 -
To P&L Adjustment A/c (Loss) 4,440 2,960 - By Cash / Bank A/c - - 42,000
To Balance c/d 1,33,560 1,13,040 18,000 By Goodwill A/c 72,000 48,000 -
2,28,000 1,52,000 42,000 2,28,000 1,52,000 42,000

New Balance sheet as on 1st April, 2012

Liabilities Amt. (`) Amt. (`) Assets Amt. (`) Amt. (`)
Capital Accounts Building 88,000
Akash 1,33,560 Less: Depreciation 4,400 83,600
Badal 1,13,040 Plant 60,000
Sagar 18,000 2,64,600 Less: Half taken over by Aksash 30,000 30,000
Sundry Creditors 60,000 Investments 48,000
Stock 32,000
Sundry Creditors 90,000
Less: R.D.D. 2,000 88,000
_______ Cash/Bank (1,000 + 42,000) 43,000
3,24,600 3,24,600
Working Notes:
Valuation of Goodwill
48,000  52,000  80,000
Average Profit = = ` 60,000
3
Goodwill = Average Profit  No. of years purchase
= 60,000  2
= ` 1,20,000

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